A brilliant excerpt from the fifteenth chapter of Kevin Carson’s draft on Organisational Theory, which I will discuss in detail in daily submissions from October 2 to 5. If you can’t wait, go read it now, it’s has all the makings of a masterpiece.

In this excerpt, Kevin Carson discusses a possible counter-strategy to the collapse of the financial economy:

We’re experiencing a singularity, of sorts, in which it is becoming impossible for capital to prevent a shift in the supply of an increasing proportion of the necessities of life from mass produced goods purchased with wages, to small-scale production in the informal and household sector. The upshot is likely to be something like Vinay Gupta’s “Unplugged” movement (see below), in which the possibilities for low-cost, comfortable subsistence off the grid result in exactly the same situation, the fear of which motivated the propertied classes in carrying out the Enclosures: a situation in which the majority of the public can take wage labor or leave it, if it takes it at all, the average person works only on his own terms when he needs supplemental income for luxury goods and the like, and (even if he considers supplemental income necessary in the long run for an optimal standard of living) can afford in the short run to quit work and live off his own resources for prolonged periods of time, while negotiating for employment on the most favorable terms. It will be a society in which workers, not employers, have the greater ability to walk away from the table. It will, in short, be the kind of society Wakefield lamented in the colonial world of cheap and abundant land: a society in which labor is hard to get on any terms, and almost impossible to hire at a low enough wage to produce significant profit.

The potential for defection is heightened by the greater efficiency with which the counter-economy extracts use-value from a given amount of land or capital.

…[T]he owning classes use less efficient forms of production precisely because the state gives them preferential access to large tracts of land and subsidizes the inefficiency costs of large-scale production. Those engaged in the alternative economy, on the other hand, will be making the most intensive and efficient use of the land and capital available to them. So the balance of forces between the alternative and capitalist economy will not be anywhere near as uneven as the distribution of property might indicate.

If everyone capable of benefiting from the alternative economy participates in it, and it makes full and efficient use of the resources already available to them, eventually we’ll have a society where most of what the average person consumes is produced in a network of self-employed or worker-owned production, and the owning classes are left with large tracts of land and understaffed factories that are almost useless to them because it’s so hard to hire labor except at an unprofitable price. At that point, the correlation of forces will have shifted until the capitalists and landlords are islands in a mutualist sea–and their land and factories will be the last thing to fall, just like the U.S Embassy in Saigon.

Johan Soderberg refers to the possibility that increasing numbers of workers will “defect from the labour market” and “establish means of non-waged subsistence,” through efficient use of the waste products of capitalism. [Soderberg, p. 172.] The “freegan” lifestyle (less charitably called “dumpster diving”) is one end of a spectrum of such possibilities. At the other end is low-cost recycling and upgrading of used and discarded electronic equipment: the rapid depreciation of computers makes it possible to add RAM to a model a few years old at a small fraction of the cost of a new computer, with almost identical performance.

The central barrier to garage production of computers is the microprocessor, which can only be produced on capital equipment costing nearly a billion dollars. But reprogrammable microprocessors will eliminate that barrier, with millions of discarded chips enabling garage industry to operate entirely on recycled inputs in the same way that minimills reprocess scrap steel on a small scale wherever a market exists. In Cory Doctorow’s Themepunks, for example, a small workshop uses the chips harvested from thousands of discarded Elmo dolls.

Paul Goodman and Ivan Illich both remarked, in their unique ways, on the effect of radical monopolies in making comfortable poverty impossible. As the alternative economy undermines the ability of artificial property rights to levy tribute on access to the means of subsistence, comfortable poverty becomes increasingly feasible.

Dave Pollard, of How to Save the World blog, describes his own version of the singularity in “The Virtuous Cycles of the Gift Economy.” As people do the things they love and become better at them, it takes less and less money to live. People need to work less, and can devote the saved time not only to further developing production technique. People develop more skills, become more self-sufficient, and less dependent on store-bought commodities purchased with wages. They also invest a greater share of their productive energy in the gift economy and mutual aid, and a greater share of their time in building social capital. As a result, people on average are happier, healthier, and more responsible and competent; social problems and social costs decline, which further adds to the virtuous cycle of reduced cost and frees up more time from work. “These cycles are, of course, subversive. They threaten to undermine and starve the ‘market’ economy by freeing us, the end-customers of that economy, from the need to pay money into it.”

This undermining and starving is exactly what we discussed in Chapter Thirteen: building the structure of the new society within the shell of the old. Pollard describes, as one way of bring about major global change, “incapacitation–rendering the old order unable to function by sapping what it needs to survive.”

But suppose if, instead of waiting for the collapse of the market economy and the crumbling of the power elite, we brought about that collapse, guerrilla-style, by making information free, by making local communities energy self-sufficient, and by taking the lead in biotech away from government and corporatists (the power elite) by working collaboratively, using the Power of Many, Open Source, unconstrained by corporate allegiance, patents and ‘shareholder expectations‘?

Gupta’s short story “The Unplugged” related his vision of how such a singularity would affect life in the West.

Wealth stored as dollars was essentially a share in America’s national economy – a credit note backed by the US Government. But Buckminster Fuller showed us that wealth-as-money was a specialized subset of Wealth – the ability to sustain life.

To “get off at the top” requires millions and millions of dollars of stored wealth. Exactly how much depends on your lifestyle and rate of return, but it’s a lot of money, and it’s volatile depending on economic conditions. A crash can wipe out your capital base and leave you helpless, because all you had was shares in a machine.

So we Unpluggers found a new way to unplug: an independent life-support infrastructure and financial architecture – a society within society – which allowed anybody who wanted to “buy out” to “buy out at the bottom” rather than “buying out at the top.”

If you are willing to live as an Unplugger does, your cost to buy out is only around three months of wages for a factory worker, the price of a used car. You never need to “work” again–that is, for money which you spend to meet your basic needs.

The idea was to combine “Gandhi’s Goals” (“self-sufficiency,” or “the freedom that comes from owning your own life support system”) with “Fuller’s Methods” (the dymaxion principle of getting more with less).

In conclusion:

If this singularity will enable the producing classes in the industrialized West to defect from the wage system, in the Third World it may enable them to skip that stage of development altogether. Gupta concluded “The Unplugged” with a hint about how the principle might be applied in the Third World: “We encourage the developing world to Unplug as the ultimate form of Leapfrogging: skip hypercapitalism and anarchocapitalism and democratic socialism entirely and jump directly to Unplugging.”

Gupta envisions a corresponding singularity in the Third World, when the cost of an Internet connection, through cell phones and other mobile devices, falls low enough to be affordable by impoverished villagers. At that point, the transaction costs which hampered previous attempts at disseminating affordable intermediate technologies in the Third World, like Village Earth’s Appropriate Technology Library or Schumacher’s Intermediate Technology Development Group, will finally be overcome by digital network technology.

The question of the transition period is a real one. There is a very real possibility that the material foundations of the new decentralized economy will not be sufficiently laid down before the old economy’s system of circulation breaks down, so that many who are dependent on employment lose their means of support with nothing to take its place. How to manage the transition is far beyond the scope of this analysis. My main purpose has been, first, to show that such a transition is likely, whether we like it or not, as state capitalism reaches its limits and the technical and organizational means of withdrawing from it become available; and second, to show the likely outlines of a successor society based on the new technical and organizational means. My personal opinion, as I have already discussed in Chapter Twelve in regard to the crisis of centralization resulting from Peak Oil, is that the transition will be relatively long and stable, compared to (say) the catastrophic collapse scenarios of James Kunstler.

At any rate, the more widespread the means of subsistence in the informal and household economies, and the more local infrastructure exists for exchange and barter, the more closely the transition crisis will resemble the paper crisis envisioned by Schumacher. For someone who has avoided or paid off credit card debt, who has obtained a modest mortgage and made paying it off as quickly as possible his top priority, and who has a large and productive vegetable garden, the possibility of unemployment is scary. But it’s nowhere near as terrifying as for someone who’s currently barely making the monthly interest payments on his mortgage, and who’s cashed out all his home equity and maxed out all his credit cards buying a Wii and a big-screen TV and getting a new model car every couple years. Even for the creditors and the unemployed described by Schumacher’s questioner, having a roof over your head free and clear and a reliable source of food will reduce, to a large extent, the concrete harm from the paper collapse.

My hope, at least, is that conventional measures like GDP will suffer (if only gradually, over a generation) what appears to be a catastrophic implosion, as people simply stop buying shit, cut back on the hours of wage labor they previously worked to earn the money to pay for shit, and supply more and more of their own needs producing for themselves and exchanging with their neighbors. My hope, at the same time, is that people will be so busy producing for themselves and their neighbors, and enjoying their control over their own lives and work and consumption, that the collapse of the state capitalist economy won’t matter very much to them.